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Non-Tech : Bid /Ask Spreads - Market Manipulation

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To: Robert Everett who wrote (22)8/21/1996 6:16:00 PM
From: Earl Gipson   of 308
 
Bob,

Sorry it took a while to get back to you, I actually had to go do some work. I am in the process of transferring my current stocks to a new E*trade account to hopefully react to the market a little quicker than I have in the past. I now have time to dedicate 3 hours a day to this. Of course I have some questions.

I have noticed a pattern in some of the smaller stocks where the volume stays fairly even for a long period with no significant price movement and then a jump in volume and in price with no announcements or news releases. Even after reviewing the Edgar filings, I see no significant or potential change for some of these companies. Could this be an indication of steady accumulation by the market makers until it can be "run up" or did they just discover the stock?

My next question is about the daily price fluctuations. I have seen small stocks (around 15 to 25) fluctuate a full point during the day. What are the chances of me getting an order executed at the lower swing? Do I even have a prayer? With the amount I am investing even a small daily swing could be quite profitable and I can actually take the time to watch the ticker.

You mentioned warehousing and net pricing. Please explain how this is done and how the investor can tell or avoid it. With all the charts and information is there a pattern?

With advent of Internet trading are the dealers as likely to disappear when the price is falling or is it business as usual?

The SEC is being slammed everywhere now and I cannot think of a more deserving bunch along with NASD. The local Seattle paper even recommended that investors not read the sec.gov if they don't want a heart attack.

I realize I will probably get "beat up" a bit in this venture, but I learn fast, so the bleeding won't be terminal.

Any other interesting reading material? I have started Serpent on the Rock.

later,

Earl
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